Oil Surge Triggers Rate Hike Bets, Gold Prices Fall to $4,334

Gold prices fell to $4,334 per ounce on Monday as rising crude oil costs fueled expectations of a US Federal Reserve interest rate hike.

The increase in energy prices has surged by over 2% following reports of fresh geopolitical tensions in the Middle East.

This has led to fears of persistent inflation, prompting market participants to price in an 86.5% probability that the Federal Reserve will raise interest rates during its upcoming meeting.

When central banks raise interest rates to control inflation, US Treasury yields often rise, making non-yielding assets like gold less attractive to investors.